The Amaiz Jar Account - Start saving towards your goals
We're pleased to announce the arrival of Amaiz Jar Accounts. You can open a back-up Jar account in our app (in seconds) to store up money for anything you like - from trips abroad to tax bills, hosting fees to emergencies. With an Amaiz Jar, it's easy to set clear, achievable goals. However big or small.
What is an Amaiz Jar Account?
When you're self employed, sometimes you need somewhere to stash a little cash - a safe harbour for your hard-earned. Perhaps you're eyeing a new laptop. A well-needed break. Or a VAT bill. Whatever's on the horizon for your small business, you can prepare by keeping money in an Amaiz Jar sub account linked to your main business current account. It's still your money, just moved to one side for when you need it most.
What can I use my Amaiz Jar for?
An Amaiz Jar account is just like any money jar - it has the potential to be used for anything you like. Saving as a sole trader means you retain all the profits from your business, rather than having to share the spoils. This maximises potential income and allows you to save up for personal or business goals. So if you do have a little leftover each month, we’ve identified five key uses for your Amaiz Jar, aside from fun money, which is also essential!
- Back-up fund
- Business Growth
- Pension pot
- The Lucky break
Back up fund
You can never be sure quite what's around the next corner when you're self employed. Your computer crashes, your car breaks down, a supplier sends an invoice you'd completely forgotten about. Every day, this happens to someone, somewhere. Small businesses can suffer financial emergencies of all shapes and sizes. By regularly moving money to a reserve account you're preparing for the unexpected.
If your work is seasonal, has unpredictable trading cycles, or you struggle for cash at certain times, it's a good idea to lock money away during the fatter months. Another risk you face as a sole trader is a lack of work due to illness or family commitments. Having a space for contingency funds helps you stay afloat. Similarly, some clients either pay late or not at all. A 2016 survey conducted for Simply Business found that 68% of small businesses had to write off bad debt that year. A sinking fund is a smart idea and helps you spread risk across the year.
Going solo comes with tax responsibilities, including budgeting for the money you'll owe HMRC at the end of the year. There's no employer to scoop up money from your salary and send it for you. So moving between 20-30% of your income into a Jar every month keeps you one step ahead - and leaves plenty by the time Self Assessment comes around. It should also cover any National Insurance contributions. Don't forget you won't need to pay any income tax if you’re not earning over £12,500 a year. And if you make over £50,000, you'll pay a little more than the basic rate for every subsequent step over this threshold. You will also have to pay Class 2 and Class 4 National insurance if your profits are over £6,365. But 30% in total should cover it.
More info is available at gov.uk
If you're VAT registered, you're essentially a tax collector for the government (who knew...pop that on your CV), and as such you'll need to keep it safe to pass that 20% (or so) on. You can make a little profit in the process, though.
Growing a small business may require you to advertise, rack up the miles or knock on more doors. All of which costs money. So if you need help budgeting, the fastest way to save money is to use a sub-account. You can move money in and out as you see fit, but the sheer act of saving into a separate account makes it likely that you'll stick to your target. Growth can also mean needing to hire new staff, freelancers or contractors, so your Jar might be handy for payroll costs or that first month’s pay packet.
There are a few self employed pension options out there. Having no pension at all is probably not one of them. But for sole traders, it's all too common. The Association of Independent Professionals and the Self Employed (IPSE) found just 31% of self-employed workers currently pay into a pension even though 67% are worried about long term financial planning. The trouble is, irregular income patterns can make saving difficult. Can you afford to commit funds regularly? The solution for sole traders can lie in stakeholder pensions – which you can stop and start without penalty, with a maximum charge capped at 1.5%. So you could use your Jar account as a feeder for a pension. If you have enough to make regular contributions, take it from your Jar. On the other hand, if you can only make ad hoc payments, wait until you've filled your Jar first - and you can afford the outlay.
The Lucky break
Sometimes new opportunities spring from nowhere. A significant project lands in a far-flung location or a bigger, brasher client comes knocking. It might mean forking out on new equipment, sourcing exotic types of insurance, travel; maybe even hiring staff or upskilling yourself. But what if you don't have the cash to hand? You might miss the chance to grow your business because you're not ready. Financial planning experts recommend that reserve funding for self employed sole traders should form a significant part of a business plan, right from the outset. According to the Office for National Statistics (ONS), small business survival rates are as high as 91% after one year of trading in some industries but drop off to 40% by year five. Poor planning is highlighted as one of the main reasons.
How can I start a Jar account?
Starting your Jar account is easy. Simply tap 'Add Jar Account' from your main account.
You can move money between your main account and Jar, as often as you like - for free.
How does the Amaiz Jar work?
Because you're squirreling money away it wouldn't be much good if you could spend it at the drop of a hat. So there is no business MasterCard for your Jar. You'll need to move money back into your main account to make purchases or cash withdrawals.
Find your Amaiz Jar in the app
We've created Amaiz Jar accounts so you can save your money for the important things without needing a separate bank account. Any money you lock into your Jar will be safeguarded from your daily spending so you can be sure your aims are never taking a back seat. With a Jar account, you’re automatically focusing on the things that matter most to your business.
Save the change
We used to save the change in our pockets at the end of the day; we'd toss it in a bowl or jar. This could quickly add up to a few hundred pounds for all sorts of things. It’s not quite so easy in the age of plastic, but saving into a digital jar can help you with modest saving aims, as well as more lavish purchases. One way you can do this is to round up the pennies (or pounds, to the nearest ten) and move them into your Jar. Do this a couple of times a week and it’ll soon add up.
If you have questions about Amaiz Jar accounts, our expert team is always happy to help. You can reach out to them any time by email or in the app.
And you can open a business account with all the support you need in minutes.